"How much should I spend on marketing?" is the question every home-service owner eventually asks — usually right after a slow month or a scary marketing invoice. The honest answer is "it depends," but that's useless on its own. So here are real benchmarks, the factors that move them, and — most importantly — how to know whether your spend is actually working.
The percentage-of-revenue rule of thumb
The standard starting benchmark for home-service businesses is roughly 5–10% of revenue on marketing, with two big adjustments:
- Established, steady business that just wants to maintain: the lower end, around 5%.
- Growing, or in a competitive market, or newer and building a name: the higher end, 10% or more — sometimes 15%+ during an aggressive push.
So a shop doing $1M a year typically spends somewhere between $50K and $100K+ annually, all-in. If you're spending almost nothing and wondering why growth stalled, that's your answer. If you're spending 20% with no idea what's working, that's a different problem.
Why the percentage is the wrong thing to obsess over
The percentage is a starting frame, not a rule. What actually matters is return. Marketing isn't a cost to minimize — it's an investment to optimize. If every $1 you put into a channel reliably returns $4 in booked, profitable work, the right budget is "as much as that channel can absorb."
That reframes the whole question from "how much should I spend?" to "which channels return more than they cost, and how much can I pour into them?"
The number that matters: cost per booked job
To answer that, you need to track cost per booked job (and ideally customer lifetime value), per channel:
- Total spend on a channel ÷ jobs it booked = your true cost per job.
- Compare that to your average job value and margin.
A channel where cost per booked job is a small fraction of job value is a money printer — feed it. A channel where it's eating your margin should be cut, regardless of how many "leads" it generates. Most owners track leads; the winners track booked jobs and profit.
Where the money should go (in order)
- Owned foundation first. Your Google Business Profile, reviews, and local SEO are low-cost and compound. This should be funded before anything else.
- A website that converts. Don't pay to send traffic to a site that doesn't book jobs.
- High-intent paid channels. Local Service Ads and Search Ads to control volume.
- Demand generation. Facebook/Instagram ads and seasonal offers once the above is solid.
Before you increase the budget, plug the leaks
Spending more on lead-gen is pointless if you're losing the leads you already pay for. The cheapest "new" jobs come from fixing your follow-up: answer faster, stop missing calls, and reactivate past customers. A business that books 40% of its leads instead of 25% effectively cut its marketing cost without spending a dime. Start with missed-call text-back.
When to spend more — and when to hold
- Spend more when: a channel's cost per booked job is well below your job value, you have crew capacity to service the work, and you want to grow.
- Hold or cut when: you can't track results, you're already at capacity, or a channel's cost per job is eating your margin.
Where to start
Don't pick a percentage out of the air. Start at 5–10% of revenue, fund the owned foundation first, and then let cost per booked job decide where every additional dollar goes. That discipline is the difference between marketing that compounds and marketing that just disappears.
If you want an outside read on whether your spend is working — and where it's leaking — that's exactly what our Monthly Advisor and a Growth Checkup are for.